Archive for March, 2015

A Travis County grand jury is calling on the University of Texas System to remove Regent Wallace Hall, Jr. A four-page report released Tuesday fell short of indicting the UT system regent, but said, “we are appalled at the Regent’s unaccountable and abusive behavior,” and added that it “is in the best interest of the state” to remove Hall from office.

The grand jury had been asked to look into allegations of abuse of office, misuse of information and official oppression against Hall after he conducted a personal investigation into UT Austin President Bill Powers. The grand jury said Hall’s “abusive excess” overwhelmed the system with 800,000 pages of open records requests, and added he tried to avoid paying for the report that cost about a million dollars to complete.

“Outrageously, after requiring university staff to double their effort to fulfill these parallel requests, he actually requested not to be charged (like other private citizens are) for the cost of his private open records requests.”

The report accuses Hall of avoiding transparency and accountability by communicating orders verbally to avoid a paper trail, and said his actions led to leaks of confidential student information. The report says Hall’s “over leveraging of his power resulted in lost talent, lowered morale, exposure of student information and unreasonable expenses.”

The grand jury also recommended changes in protocols for regents in the future, including making regents pay for open records requests and establishing consequences for distributing confidential data. It also suggests requiring regents to use university email accounts for all official business like other employees.

A House Committee censured Regent Hall last year due to his investigation, and several lawmakers called for his resignation. Hall’s supporters, including then-Governor Rick Perry who appointed him, said Hall’s investigation showed irregular admissions practices at UT-Austin. Hall got some vindication from an independent investigation released earlier this year that said it did find some applicants who had been accepted to UT despite objections from the admissions office due to the insistence of UT-Austin President Bill Powers. But Powers defended those actions, saying it was a common practice at colleges around the country and was in the long-term interest of the university. System Chancellor William McRaven did not discipline Powers after that report.

Rep. Dan Flynn (R – TX House District 2), who was a co-chair of the House Select Committee on Transparency in State Agency Operations, released this joint statement after the grand jury report on behalf of himself and fellow co-chair Rep. Carol Alvarado (D – TX House District 145):

The grand jury report that came out this morning demonstrates why our committee needed to investigate Regent Hall and his behavior. Taxpayers expect their elected representatives to provide oversight of state agencies and executive appointees. Such oversight is especially important when appointees abuse their office. With this investigation now complete and with an outstanding new chancellor and strong new regents in place, we are optimistic that the UT System is ready to move forward and focus on the needs of its students and our state.

Regent Hall released the following statement after the grand jury’s decision not to indict him was made public:

The campaign by Speaker Straus, Representative Flynn and Senator Seliger to criminalize my service as a Regent constitutes abuse of office. Their use of the levers of political power to cover up wrongdoing by legislators should now be investigated, and those exposed for their abuses should be driven from office.

The state’s massive agency overseeing all health an human services needs “significant changes either in management structure or executive leadership” to lift itself out of a state of turmoil, according to a new study released Friday. The report, released by a “strike force” assembled by Governor Greg Abbott in January, said recent controversies over corruption are only symptoms of larger organizational problems within the agency.

The Health and Human Services Commission is a major component of Texas government, employing nearly one out of every five state workers and spending about $30 billion per year — more than a third of the state’s budget. Governor Abbott formed a team in January to look into problems at the agency after a $110 million state contract fell through over questionable contracting procedures in the agency with Austin-based software company 21CT. Subsequent investigations have led to several high-level resignations within the agency, including a gubernatorial appointee, Inpsector General Doug Wilson. Despite the report’s suggestion of “a change in leadership,” there’s still no word on the future of the HHSC’s executive director, Kyle Janek. Several lawmakers have called for him to step down, while Governor Abbott had previously said they would wait until after the report to make a decision.

That 21CT deal led to questions over the use of cooperative contracting, a type of contracting intended for smaller purchases that allows agencies to sidestep the normal bidding process. But Monday’s report defended that process, calling it a useful method often employed successfully by the state government. It points out “the 21CT controversy had as much to do with the actions of individuals as it did with the contracting process.” It suggested more restrictions and oversight on the Inspector General’s Office, as opposed to eliminating it altogether.

Monday’s report also urged caution about the idea of consolidation of HHSC agencies. Lawmakers have proposed turning the five agencies into one “mega agency” by 2016, but Monday’s report said many of the agency’s problems stem from the last consolidation — from 12 agencies to five — in 2003. The report said that deadline needs to at least be pushed back, and “may not be the right strategy for future success.” It urged lawmakers to consider the implications of that consolidation, saying the agencies are too broad to be successfully run by one entity. They say keeping some functions separate would lead to less risk of neglect and could help attract better and more specialized leadership.

Governor Abbott’s strike force included former Travis County state district judge and current UT Austin professor F. Scott McCown, as well as Texas A&M University System CFO Bill Hamilton, Texas Department of Agriculture CFO Heather Griffith Peterson, and former State Rep. Talmadge Heflin.

Governor Abbot released a statement responding to the quote, saying

“The report’s findings are deeply troubling. It is now more clear than ever that the Texas Health and Human Services Commission has been riddled with operational, managerial, structural and procedural problems that go far beyond any individual or contract. That is unacceptable. As Governor, I am committed to addressing these issues head-on. Upon assuming office, I took the immediate step of directing all state agencies – including HHSC – to implement key transparency and accountability reforms to their contracting and procurement processes. I will take the findings of the strike force’s report into account as I determine what additional actions must be taken to ensure Texans can have the trust they deserve to be able to place in their government.”

Cooperative contracting is the controversial program that allows companies to bypass the usual bidding process for state contracts. The program, which was designed for smaller purchases, made headlines last year when Austin-based software company 21CT received a $20 million contract for Medicaid fraud detection software through that process. Subsequent accusations of corruption within the department led to several high-level resignations at HHSC, and a legislative push for more oversight in the state’s contracting process.

Senate Finance Committee Chair Jane Nelson (R – TX Senate District 12) filed Senate Bill 20, and dedicated Wednesday’s committee meeting to her legislation. It would require agency heads to approve the use of a cooperative contract for anything over $1 million and would prohibit any conflicts of interest with high-ranking department officials. It would also mandate an increasing number of competitive bids depending on the size of the contract, and would require agencies to develop an online database to post their contracts online.

“The recent reports of irregularities in contracts at our health and human services agencies have revealed what I perceive to be gaping holes in our laws on contracting,” Nelson said. “Those gaps need to be addressed across state government. Senate Bill 20 strengthens accountability, increases transparency and ensures the fair competitive bids in awarding of state contracts.”

The Finance Committee heard testimony from several departments, including the HHSC, but left the bill pending. The committee is expected to vote on the legislation next week.

The Texas Senate has passed its first pieces of legislation of the session. Senate Bill 5 and Senate Joint Resolution 5 both passed by a 28-2 vote Wednesday.

The bills would direct the state’s car sales tax revenue into the state highway fund starting in 2017, up to $2.5 billion per year. Any money above that would be split, with half going to the state highway fund and the remainder going to the general revenue fund. The Senate approved an amendment proposed by Sen. Royce West (D – TX Senate District 23) to dedicate some of the money to education.

Supporters of the bill praised the stability for roads that the bill could provide. “This bill provides predictable funding for roads in the future,” Sen. Donna Campbell (R – TX Senate District 25) said.

Sen. Kirk Watson (D – TX Senate District 14) said he supports appropriating funding for roads, but added concern about dedicating funds. He said it could lead to a lack of flexibility in the future to pay for other needs. “We need money for roads,” he said, “but it’s not our only need. It’s just our most visible need. We need to find new funding. This is not new money, it’s existing funding being called a new name.”

Both bills will now go the House. If passed there, the bills will go to Governor’s Abbott’s desk for a signature.

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